LuxLeaks whistleblower: ‘It was a necessary evil’

LUXEMBOURG — The French man accused of stealing trade secrets after he gave a journalist confidential accounting records said he never intentionally set out to expose the tax dealings of multinational firms in what became known as the “LuxLeaks” scandal.

Testifying in his trial on theft charges Tuesday morning, Antoine Delfour said he came across the information — including details of sweetheart tax deals companies had struck with the Luxembourg government — by chance while working at the audit firm PricewaterhouseCoopers (PwC).

The Luxembourg trial is being watched closely to see whether the court will consider Deltour a whistleblower or a criminal. Some EU politicians are hoping to use the case as a reason to boost protections for whistleblowers.

Deltour, 30, told the court he copied the documents the day before he left PwC in October 2010. He said he had decided to quit the firm to pursue a career as a French civil servant. He also said he did not agree with PwC’s policy regarding the tax arrangements, on which he had worked to check compliance with accounting rules.

He said it was due to a technical bug in the PwC computer server that he was given access to the sensitive documents, which he saved on an external hard drive.

People hold a drawing depicting Antoine Deltour, demonstrate outside the courthouse in Luxembourg, on April 26, 2016, in support of whistle-blower Antoine Deltour, during his trial over the so-called LuxLeaks scandal | John Thys/AFP via Getty Images

It was only after leaving the company, Deltour said, that he realized the value of the material he had taken. He said he tried unsuccessfully to contact NGOs and tax evasion experts to discuss the documents. Months later he was contacted by a reporter for the French TV program “Cash Investigation,” Edouard Perrin, who saw a comment left by Deltour on a blog post about tax rulings.

Deltour eventually gave the documents to Perrin, who is also on trial in Luxembourg for his involvement in the release of confidential information. But in his testimony Tuesday, Deltour said he never intended those documents to be used to name and shame PwC or its clients.

Perrin, also testifying Tuesday, said he was surprised by the “magnitude” of the information handed over by Deltour, who faces a 10-year jail sentence and a fine of up to €1.3 million.

While Deltour said he never expressly agreed for Perrin to publish the documents, the reporter said he had been clear about the value of the documents for his reporting.

“Taking into account the great impact [of the revelations], it would be worth it to do it again” said Deltour, calling the decision to reveal confidential records of several companies “a necessary evil.”

Also on trial for theft and breaching of trade secrets charges is former PwC employee Raphaël Halet, who prosecutors say was pushed by Perrin to look for specific documents.

Deltour has become something of a poster boy for politicians hoping to reform the way whistleblowers are treated. Green MEPs in the European Parliament launched a proposal Tuesday for legislative reform which, if adopted, would create a single whistleblower protection regime across Europe.

According to Julia Reda, one of the MEPs who worked on the proposal, a pan-European legal framework to protect whistleblowers would have a dramatic impact on cases such as those of Deltour.

Julia Reda from the Group of the Greens/European Free Alliance | EPA/Patrick Seeger

“Currently Deltour is in a situation in which the existing Luxembourg whistleblower protections do not apply because they do not cover disclosure of information to the media,” Reda said.

This shortcoming, according to Reda, has failed Deltour because while those reporting criminal activity to authorities are protected under local laws, those leaking information on matters that have political implications but may not be illegal — such as tax minimization — are left exposed.

“We [are proposing] different reporting channels which make sure that even if a law-enforcement authority or an employer feels no need to intervene, the public can still learn about these activities,” said Reda, who is a German member of the Pirate Party, a political organization which supports civil rights and direct democracy.

The Greens’ proposal, which will be presented to Parliament’s political leaders Wednesday, is a political move designed to keep pressure on the European Commission to take the lead in developing legislation to protect whistleblowers across the EU.

The Commission has told Parliament’s tax rulings committee (TAXE), which is investigating the LuxLeaks affair, that it will respond to the committee’s request for legislation by the end of June. It has not announced whether it plans to put forward a legislative proposal or hand the problem back to EU member countries.

The Greens’ proposal would also rule out criminal lawsuits being brought against whistleblowers such as Deltour, instead requiring that they defend themselves in a civil court.